Your negotiation journey – part two
Do you want to know why many of us fail whilst negotiating? The answer is simple. But let’s focus first on one of the key challenges faced in negotiation. Be clear on what is in it for you! And it goes beyond a low price for buyers and a high price for sellers. Be it at a job interview, at the negotiation table with a buyer, or even at home with our partners, being clear on what we want to accomplish is simply A MUST. One simple tool will help you make your interests crystal clear: the polygon of interests*.
The tool makes you evaluate the multiple interests you have in finding an agreement. As agreeing on one sole interest leaves little room for interaction. It increases friction around the interest at stake, usually price. A polygon of interests enables us to see multiple interests. It shows where both parties can give and take on multiple fronts. A strong polygon showcases all your interests in reaching an agreement. Each side of the polygon provides an opportunity for your counterpart to create value for you and reciprocally.
Firstly, if your negotiation is only about price – you are bargaining. More on that in part nine of this series, where we will be talking about the Ackerman technique. Now if your negotiation spectrum is broader, clarifying your interests will be what will define your negotiation success. A rule of thumb is to use between five and seven interests that you have in reaching an agreement with a counterpart. Each interest is represented by a face of the polygon. The more faces your polygon has, the more flexible your position will be, and thus your ability to reach an agreement will be greater.
Now that the interests have been set, there are three positions that you should determine for each of them: initial position, red line/reserved position, and mid-range position. The initial position is your best-case scenario. It is supported by facts and can be justified at any time. Your red line is your last offer. Below this threshold, the position becomes a bad position or a bad deal for you. Do not accept bad deals! Finally, the mid-range position is very helpful while seeking a concession. A best practice in setting your mid-range position is to have it closer to your red line rather than your initial position. Find out more about the rationale behind this trick in the ninth skill – the Ackermann technique.
Now that you have set your interests and placed all positions, you can start the negotiation. In the first round, you do not need to state all of them. But when you do, always start at the initial position. Why? This position is fact-based and justified. If the position is perceived too high by your negotiating partner, you can lower one of your positions and ask for a counterpart from your partner. The impact of this technique on your negotiation will be immediately perceivable. While some of your positions will gravitate towards the mid-range or even reach the red line, you could even get out more than your initial position on certain interests. The outcome is simple, if you lower a position towards a red line, you will be able to receive more on other important positions.
In summary, the polygon of interests creates currencies for both parties to offset conflicting interests at the negotiation table. The currencies increase your likelihood of finding an agreement. Use this template to build your first polygon of interests and look beyond price for your next agreement. So now you know why we often fail in negotiations. It is because we do not know well enough what we want.
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About the author
Constantin Papadopoulos is a senior marketing & sales consultant. He builds bridges between services & products and their respective audience. He is also a communication & negotiation trainer for the Swiss Army.